Coal Plant on Public Hot Seat This Week

Adam Lynch

Ocean Springs attorney Robert Wiygul is representing the Mississippi Sierra Club in its opposition to a proposed coal plant in Kemper County.

by Adam Lynch
February 3, 2010

The Mississippi Public Service Commission began the second phase of hearings this week to determine the need for a proposed $2.4 billion coal plant in Kemper County.

Mississippi Power Company filed a certificate of public convenience with the PSC last year asking it to begin setting aside 48,000 square acres of Kemper County land for lignite coal-mining and the construction of a 582-megawatt lignite coal-burning plant using technology that doesn’t exist, yet.

The commission responded by breaking the issue down into a series of hearings. Phase 1 of the hearings, conducted between Oct. 5 and Oct. 9, 2009, resulted in the commission finding a growing need for more electrical capacity in the state, and they issued an order establishing a bidding process for resource options.

Phase 2 of the hearings, which began Monday, Feb. 1, will address the Kemper integrated gasification combined cycle, or IGCC, project, why the company chose a $2.4 billion coal plant over cheaper alternatives (such as promoting home weatherization among its customers), as well as government financing incentives, cost recovery, risk calculation and potential rate increases.

Sierra Club Director Louie Miller insists that “clean coal” is a bogus concept that exists only in “some advertising guy’s imagination,” and argues that ratepayers don’t know what kind of rate increase to expect from funding the construction of the plant.

Entergy Mississippi distributed the cost of a similar investment it made in the $3 billion Grand Gulf Nuclear Power plant in 1985, among a customer base of 300,000, which raised rates an average of 50 percent over the course of two decades. Mississippi Power, comparatively, has only 186,000 customers who will have to absorb the Kemper plant’s cost of $2.4 billion.

The company maintains that it needs to balance the volatile natural gas market with a plant that burns a more economically stable fuel, like coal. Opponents argue that the plant costs too much and will raise Mississippi Power customer rates.

Mississippi Power President and CEO Anthony Topazi told the commission during his opening statements Monday that Mississippi Power needed to move away from the volatile natural gas market by concentrating on coal plants, which use a fuel source less subject to market swings.

“Natural gas is the most volatile commodiuty we can use,” Topazi said, adding that new Environmental Protection Agency findings on greenhouse gases would likely drive the company to either close down its coal plant on the coast or invest about $1 billion to upgrade it to a cleaner-burning facility.

“Clean coal is a means to give our customers the stability they demand,” Topazi said.

But the coal plant issue is as volatile as Topazi’s estimate of the natural gas market, apparently. The Jackson Free Press reported Jan. 29 that the Mississippi Chapter of the Sierra Club had filed a motion to remove attorney Katherine Briggs Collier the proceedings, arguing that Briggs’ father, Eddie Briggs, is a principal in Kemper Natural Resources, LLC, the company purchasing mineral leases and land for the Kemper County coal plant. Briggs’ father has a long-term contract with Mississippi Power—the company seeking to build the plant.

The commission will spend the rest of the week hearing critics of the coal plant, and from competing power producers who demand Mississippi Power make more use of under-utilized existing natural gas plants—which will not raise customer rates.

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